Rearranging the Family? Income Support and Elderly Living Arrangements in a Low Income Country

39 Pages Posted: 27 Feb 2004 Last revised: 31 Aug 2010

See all articles by Eric V. Edmonds

Eric V. Edmonds

Dartmouth College - Department of Economics; National Bureau of Economic Research (NBER); IZA Institute of Labor Economics

Kristin Mammen

Columbia University - Barnard College

Douglas L. Miller

University of California, Davis - Department of Economics

Date Written: February 2004

Abstract

Despite the importance of living arrangements for well-being and production, the effect of changes in household income on living arrangements is not well understood. This study overcomes the identification problems that have limited the study of the link between income and living arrangements by exploiting a discontinuity in the benefit formula for the social pension in South Africa. In contrast to the findings of the existing literature from wealthier populations, we find no evidence that pension income is used to maintain the independence of black elders in South Africa. Rather, potential beneficiaries alter their household structure. Prime working age women depart, and we observe an increase in children under 5 and young women of child-bearing age. These shifts in co-residence patterns are consistent with a setting where prime age women have comparative advantage in work away from extended family relative to younger women. The additional income from old age support may induce a change in living arrangements to exploit this advantage.

Suggested Citation

Edmonds, Eric V. and Mammen, Kristin and Miller, Douglas L., Rearranging the Family? Income Support and Elderly Living Arrangements in a Low Income Country (February 2004). NBER Working Paper No. w10306, Available at SSRN: https://ssrn.com/abstract=510002

Eric V. Edmonds (Contact Author)

Dartmouth College - Department of Economics ( email )

6106 Rockefeller Hall
Hanover, NH 03755
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
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IZA Institute of Labor Economics

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Germany

Kristin Mammen

Columbia University - Barnard College ( email )

3009 Broadway
New York, NY 10027
United States

HOME PAGE: http://www.columbia.edu/~kmm13/

Douglas L. Miller

University of California, Davis - Department of Economics ( email )

One Shields Drive
Davis, CA 95616-8578
United States
530-752-8490 (Phone)

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